Glossary Terms

Question 1

Public Policy

Answer 1

The actions taken by the government to prevent or encourage specific goals.

Question 2

Office of Management and Budget

Answer 2

A presidential staff agency that serves as a clearinghouse for budgetary requests.

Question 3

General Accounting Office

Answer 3

The independent agency that audits government expenditures.

Question 4

Congressional Budget Office

Answer 4

An agency of Congress that analyzes presidential budget recommendations and estimates the costs of proposed legislation.

Question 5

Tariff

Answer 5

A tax on imported goods.

Question 6

Fiscal Policy

Answer 6

Government taxing and spending policy to manage the economy.

Question 7

Supply Side Economics

Answer 7

The theory that tax cuts will expand economic activity.

Question 8

Laissez-Faire Economics

Answer 8

Economic theory that opposes government interference.

Question 9

Federal Reserve Bank

Answer 9

One of the twelve regional “banker’s banks” that in combination make up the Federal Reserve System.

Question 10

Excise Tax

Answer 10

A consumer tax on a specific kind of merchandise such as tobacco.

Question 11

Sales Tax

Answer 11

A general consumer tax.

Question 12

Regressive Tax

Answer 12

A tax that weighs most heavily on those least able to pay.

Question 13

Progressive Tax

Answer 13

A tax graduated so that people with higher incomes pay a larger fraction of their income than people with lower incomes.

Question 14

Value Added Tax

Answer 14

A tax on increased value of a product at each stage of production and distribution rather than just at the point of sale.

Question 15

Tax Expenditure

Answer 15

Loss of tax revenue due to federal tax laws that provide special tax incentives or benefits to individuals or businesses.

Question 16

Deficit

Answer 16

The difference between the revenues raised annually from sources of income other than borrowing and the expenditure of government including paying the interest on past borrowing.

Question 17

Debt

Answer 17

The accumulated total of federal deficits minus surpluses

Question 18

Inflation

Answer 18

A rise in the general price level (and decrease in dollar value) owing to an increase in the volume of money and credit in relation to available goods.

Question 19

Gross Domestic Product

Answer 19

An estimate of the total output of all economic activity in the nation including goods and services.

Question 20

Entitlement Program

Answer 20

Government programs such as Social Security Medicare

Question 21

Monetarism

Answer 21

The theory that money supply is the key factor in the economy’s performance.

Question 22

Subsidy

Answer 22

A government payment to a specific group.

Question 23

NAFTA

Answer 23

Agreement signed by the United States, Canada, and Mexico in 1992 to form the largest free-trade zone in the world.

Question 24

Regulation

Answer 24

The attempt by the government to control the behavior of corporations other governments, or citizens through altering the natural workings of the open market to achieve some desired goal.

Question 25

Deregulation

Answer 25

A policy promoting cutbacks in the amount of federal regulation in specific areas of economic activity.

Question 26

Protectionism

Answer 26

A policy that favors domestic producers or workers.

Question 27

Taft-Hartley Act

Answer 27

The national law (1974) that restricted union rights.

Question 28

Closed Shop

Answer 28

A company with a labor agreement whereby union membership is a condition of employment.

Question 29

Union Shop

Answer 29

A company in which new employees must join a union within a stated time period.

Question 30

Collective Bargaining

Answer 30

Direct negotiations between an employer and a union over employment conditions.

Question 31

OSHA

Answer 31

The federal agency concerned with employee safety and health.

Question 32

Monopoly

Answer 32

Technically, a market in which only one supplier exists. Commonly, a market with few suppliers (oligopoly).

Question 33

Sherman Anti-Trust Act (1890)

Answer 33

The first major national law designed to prevent business monopoly and preserve competition.

Question 34

Trust

Answer 34

A monopoly that controls goods and services often in combinations that reduce competition.

Question 35

Interlocking Directorate

Answer 35

A corporation in which an officer or director sits on the board of a competitor with the effect of restraining trade.

Question 36

Clayton Act (1914)

Answer 36

The law that specifically exempted labor from its provisions while closing loopholes in the Sherman Anti-Trust Act.

Question 37

Independent Regulatory Agency

Answer 37

A government agency that exists outside the three branches of government and is responsible for enforcing particular statutes.

Question 38

Federal Trade Commission

Answer 38

Established in 1914 to prevent unfair business methods.

Question 39

National Labor Relations Act (Wagner Act)

Answer 39

The 1935 law recognizing the right of workers to organize and bargain collectively.

Question 40

Right-To-Work Law-

Answer 40

State law forbidding union shops.

Question 41

Clean Air Act

Answer 41

The law of 1990 that sets air standards provides, research funds, and establishes target dates for automobile emission controls.

Question 42

Monetary Policy

Answer 42

The policy that government adopts that attempts to manage the economy through controlling the money supply and interest rates.

Question 43

Yellow Dog Contract

Answer 43

Employer contract with new employees where they promise not to join a union.

Question 44

Labor Injunction

Answer 44

Court order prohibiting certain acts such as performing a strike.

Question 45

Foreign Service

Answer 45

The government agency that, as an instrument of the State Department, develops and implements foreign policy.

Question 46

National Security Council- The committee created by Congress in 1947

Answer 46

composed of high ranking officials

Question 47

National Security Advisor- The person who is appointed by and directly advises the President on national security matters.

Question 48

Central Intelligence Agency- The agency that gathers

Answer 48

evaluates and transmits information concerning foreign nations. It also carries out secret

Question 49

Bipartisanship

Answer 49

The policy that stresses cooperation and a united front between political parties in foreign policy.

Question 50

Economic Sanctions

Answer 50

A denial of export, import, or financial relations with a target country in an effort to change the nation’s policies.

Question 51

Joint Chiefs of Staff

Answer 51

The heads of various military services who serve as advisors to the president.

Question 52

Deterrence

Answer 52

The philosophy underlying our defense strategy which requires a U.S. capability to survive a “first strike” and respond so massively that they would not attempt a “second strike”.

Question 53

Military-Industrial Complex

Answer 53

An alleged alliance between top military and industrial leaders who have a common interest in arms production and utilization.

Question 54

Cold War-

Answer 54

The post-World War II (1945-1990) tensions between the United States and the USSR and their respective allies.

Question 55

Most Favored Nation Status

Answer 55

An international trade policy whereby the United States grants to a country the same favorable trade concessions and tariffs that our best trading partners receive.